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The Negotiable Instruments Act, 1881

( ACT NO. XXVI OF 1881 )

Chapter XIV

SPECIAL PROVISIONS RELATING TO CHEQUES

Non-liability of banker receiving payment of cheque
Cheque bearing “not negotiable”
 
 
 
 
 
 
131. Subject to the provisions of this Act relating to cheques crossed “account payee”, where a banker in good faith and without negligence receives payment for a customer of a cheque crossed generally or specially to himself, and the customer has no title or a defective title thereto, the banker shall not incur any liability to the true owner of the cheque by reason only of having received such payment. Non-liability of banker receiving payment of cheque
 
 
 
 
 
 
Explanation - A banker receives payment of a crossed cheque for a customer within the meaning of this section notwithstanding that he credits his customer's account with the amount of the cheque before receiving payment thereof.

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Ministry of Law, Justice and Parliamentary Affairs